Apple reported on Tuesday that its quarterly profit dipped for the first time in nearly a decade as it squeezed less money from its champions in the competitive smartphone and tablet markets.
The maker of iPhones, iPads, iPods and Macintosh computers stepped in to bolster its stock price by announcing a plan to more than double to US$100 billion the amount it will spend to buy back its stock and pay out dividends.
Apple raised a coming stock dividend by 15 percent to US$3.05 per common share.
“We will fund the capital return program from operations and borrowing,” Apple chief financial officer Peter Oppenheimer said.
Apple shares jumped briefly on the news in after-hours trade, but slid back to US$403.95, about US$2 below where they were at the close of the NASDAQ.
“They bought themselves some extra time,” Silicon Valley analyst Rob Enderle said of Apple tapping into its cash reserves to pay off investors. “They are basically selling off Apple’s future to prop up Apple’s stock price in the short term.”
The move veers from the way late Apple co-founder Steve Jobs fiercely guarded cash reserves.
The California-based company posted a profit of US$9.5 billion on revenue of US$43.6 billion in the first three months of this year, compared with a profit of US$11.6 billion on US$39.2 billion in the same quarter last year. Its gross margin shrank to 37.5 percent from 47.5 percent.
The number of iPhones sold in the quarter rose to 37.4 million, from 35.1 million in the same quarter last year. The number of iPads sold surged to 19.5 million from 11.8 million a year earlier, but sales of iPods dropped by more than 1 million to 5.6 million and Macintosh computer sales slipped about 2 percent to just below 4 million, Oppenheimer said.
The Apple board raised the overall stock repurchase target to US$60 billion from US$10 billion.
Apple chief executive Tim Cook said that the decline in Apple stock in recent quarters has been “very frustrating for all of us.”
Shares of Taiwan-listed firms in the Apple Inc supply chain staged a rebound yesterday morning after the consumer electronics giant’s first-quarter results delivered no negative surprises, dealers said.
Major Apple suppliers, such as contract electronics maker Hon Hai Precision Industry Co (鴻海精密) and smartphone camera lens manufacturer Largan Precision Co (大立光), had slumped on concerns over Apple’s numbers.
However, they attracted bargain hunting soon after the market opened, dealers said. As of 11:23am, shares of Hon Hai, which assembles iPhones and iPads, had added 1.57 percent to NT$77.40 (US$2.60) with 15.52 million shares changing hands, while Largan had gained 1.44 percent to NT$706.00.
DISCONTENT: The CCP finds positive content about the lives of the Chinese living in Taiwan threatening, as such video could upset people in China, an expert said Chinese spouses of Taiwanese who make videos about their lives in Taiwan have been facing online threats from people in China, a source said yesterday. Some young Chinese spouses of Taiwanese make videos about their lives in Taiwan, often speaking favorably about their living conditions in the nation compared with those in China, the source said. However, the videos have caught the attention of Chinese officials, causing the spouses to come under attack by Beijing’s cyberarmy, they said. “People have been messing with the YouTube channels of these Chinese spouses and have been harassing their family members back in China,”
The Central Weather Administration (CWA) yesterday said there are four weather systems in the western Pacific, with one likely to strengthen into a tropical storm and pose a threat to Taiwan. The nascent tropical storm would be named Usagi and would be the fourth storm in the western Pacific at the moment, along with Typhoon Yinxing and tropical storms Toraji and Manyi, the CWA said. It would be the first time that four tropical cyclones exist simultaneously in November, it added. Records from the meteorology agency showed that three tropical cyclones existed concurrently in January in 1968, 1991 and 1992.
GEOPOLITICAL CONCERNS: Foreign companies such as Nissan, Volkswagen and Konica Minolta have pulled back their operations in China this year Foreign companies pulled more money from China last quarter, a sign that some investors are still pessimistic even as Beijing rolls out stimulus measures aimed at stabilizing growth. China’s direct investment liabilities in its balance of payments dropped US$8.1 billion in the third quarter, data released by the Chinese State Administration of Foreign Exchange showed on Friday. The gauge, which measures foreign direct investment (FDI) in China, was down almost US$13 billion for the first nine months of the year. Foreign investment into China has slumped in the past three years after hitting a record in 2021, a casualty of geopolitical tensions,
A registered sex offender from the US who went missing after entering Taiwan has been found and would be deported in light of the risk he poses to the public, the National Immigration Agency (NIA) said yesterday. The agency launched a search for Levi Forrest Wallace, 43, after it was informed by the American Institute of Taiwan (AIT) that he had entered Taiwan on Oct. 2 on a tourist visa. He was not on the US government’s wanted list. Wallace was sentenced to 90 days in jail with a two-year probation in 2001 after he was convicted of sexual delinquency of
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